If a firm’s marginal product of labor is currently 75 units of output, the wage is $15 per unit of labor, and output sells for $0.80 per unit, the firm should
a) shut down production
b) hire fewer workers
c) maintain its current workforce, but at fewer hours per worker
d) keep the current number of employees and hours worked
e) hire more labor
e) hire more labor
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In the current year, the CPI is 160 and during the previous year the CPI was 181. The inflation rate between these years is
A) 11.6 percent. B) -13.1 percent C) -013.1 percent. D) -11.6 percent. E) 13.1 percent.
Consumption goods and services include
A) washing machines and tickets to football games. B) new homes and existing homes (as long as improvements have been made to the existing home). C) tickets to concerts and medical care provided to veterans by the government. D) new and used textbooks as long as they are sold via stores or online. E) vacation time accumulated by workers.
The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
Consumer surplus is equal to the area
A) under the demand curve and above the supply curve. B) above the supply curve and below the price line. C) under the demand curve. D) under the demand curve and above the price line.